Minimum wage increase (SMI) in 2026: how much will it rise and who will it affect?

The new minimum wage is now official, and these are the key points

The Council of Ministers has approved the Royal Decree establishing the new National Minimum Wage (SMI), setting it at €1,221 gross per month in 14 payments (€40.70 per day or €17,094 per year), tax-exempt, and effective as of 1 January 2026.

It should be recalled that the SMI guarantees, at a minimum, that employees receive the officially established annual amount exclusively in monetary salary items. This amount may not be reduced through payment in kind or non-salary concepts such as allowances or transport expenses.

In addition, the agreement provides that the increase must be genuinely effective, preventing mechanisms of compensation and absorption of employees’ specific salary supplements. Likewise, the approved revision of the national minimum wage will not affect the structure or amount of professional salaries already received by employees where such salaries, taken as a whole and on an annual basis, exceed the minimum wage.

The same Royal Decree also establishes the SMI applicable to workers under the special regime for domestic household employees. For those working by the hour under an external arrangement, the minimum wage will be €9.55 per hour worked in domestic service. In the case of temporary and seasonal agricultural workers, the minimum wage may not be less than €57.82 per legal working day.

This new amount represents a 3.1% increase compared to the 2025 SMI. It should be noted that, since 2018, the cumulative increase has reached 66% (€485.10 per month and €6,791.40 per year).

These increases reflect the Government’s intention to give effect to the right to fair and adequate remuneration that provides workers and their families with a sufficient standard of living, in line with the criteria established by the European Committee of Social Rights, which has interpreted that this threshold stands at 60% of a country’s average wage. In addition, the measure seeks to safeguard the purchasing power of wages against the cost of living, particularly in the current price environment.

In contrast, it should be noted that the agreement has only been signed by the Ministry of Labour and Social Economy and representatives of the trade unions Comisiones Obreras (CCOO) and Unión General de Trabajadoras y Trabajadores (UGT).

Conversely, the Spanish Confederation of Employers’ Organisations (CEOE) has refused to endorse the agreement, arguing that the country’s SMEs — which make up the majority of the productive fabric — cannot withstand continuous increases in contribution bases (the minimum contribution base has risen from €1,381.20 to €1,424.50 and the maximum from €4,909.50 to €5,101.20), in contribution rates themselves (including the additional 0.90% introduced in January this year under the Intergenerational Equity Mechanism and the increase in solidarity contribution rates for bases exceeding the maximum), and now this wage increase.

According to estimates based on data from the Labour Force Survey (EPA), this increase will benefit approximately 2.5 million workers.